Local Indian rebar trade prices have remained range-bound and, though the recent rapid downtrend has eased over the past week, the overall outlook for trade has remained bearish, while smaller mills have continued to see inventory increases in the absence of large bookings, SteelOrbis learned from trade and industry circles on Tuesday, July 4.
Indian rebar trade prices are up a marginal INR 100/mt ($1.20/mt) to INR 50,100/mt ($611/mt) ex-Mumbai and are unchanged at INR 49,200/mt ($600/mt) ex-Chennai in the south.
Rebar trade prices have softened by INR 200/mt ($2/mt) to INR 46,600/mt ($568/mt) ex-Raipur and are stable at INR 46,500/mt ($567/mt) ex-Durgapur in the east.
Sources said that retail trade has remained almost dormant with users in real estate development and rural construction sharply reducing off-take in the east and north, but a sharp dip in prices has been prevented by modest buying seen from public works departments in some states heading for elections later this year and hence the stepping up of the completion of ongoing projects.
“Even factoring in the seasonal downturn, the rebar market is facing a lot of challenges of rising costs of construction, prompting contractors to lower raw material inventories. Housing demand is positive in urban areas, but this is mostly relevant to completed projects and real estate developers are cautious in launching new projects,” a Kolkata-based distributor said.
“At the same time, large buyers are seeking extended credit beyond the usual 30 days. Dealers facing working capital shortages are unwilling to increase credit, leading to a lot of bookings failing,” he said.
An official at Shyam Steel, eastern India’s largest rebar producer said that secondary mills are unable to pass on high costs to the market but are still having to push volumes at thin margins to manage inventories, impacting the operational viability of the mills.
$1 = INR 82.00